A View From The Press Box

Since they committed an illegal act to enter the country and obtain the job anyway, why wouldn't that trigger the fraud defense???

SAM RESPONDS:
In this case, it apparently did not....It didn't apparently matter whether the employee obtained the job on fraudulent terms and was in the country illegally.

You forget that many of the illegal immigrants do have valid drivers licenses and Social Security numbers. They came to the U.S. on a valid visitors visa before 9/11, and then did not return to their home country.

Before 9/11, it was easy to legally obtain both Social Security and a drivers license.

Many of these folks have worked years at their jobs and do pay taxes, even though they are in the U.S. illegally, because they remained in the U.S. past their visa exit dates.

I think that by denying benefits, the courts would be opening a Pandora's Box.

If an employee is denied benefits for obtaining a job through fraudulent documents, legal residents could just as well have their benefits denied when they submit fraudulent documents (such as a padded resume).

Also, there are many situations where employers hire illegal immigrants and KNOW that the documents are fraudulent, but hire them anyway, thinking that they are off the hook for hiring illegals.

Just because fraudulent documents were submitted, we don't know whether the employer was really fooled.

This is just another example of the courts essentially changing legal contracts after the fact. Someone lies on a document and it just doesn't matter--just pay anyway.

If we had proper control of the borders, these types of occurences would not be happening.

Here is what should happen: Since the worker is here illegally and lied on the documents, the worker should be deported and their home country should take care their medical bills.

I wonder when the worker will be deported now that their illegal status has been disclosed.

Workers' compensation protects employees and the employer from loss and litigation caused by workplace injuries.

Employees, illegal or legal, and the employer should be entitled to those protections with two exceptions--when the employer knowingly employs an illegal alien, or when the employer is duped into hiring an illegal alien through fraudulent documents.

Each state’s workers' comp law should be changed to accommodate these exceptions. No benefits should be provided, either, making them responsible for their own resulting damages or injuries.

That would require tightening the hiring process and real verification of documentation to protect the employer and limit the hiring of illegal aliens.

It does nothing about the social costs of medical care unknowingly provided illegal aliens, who may simply disappear or seek care under another cause.

While closing the workers' comp loophole, it puts the burden back on society as a whole. Does that make universal healthcare the ultimate solution?

The court reasoned “disallowing benefits would mean unscrupulous employers could hire undocumented workers without the burden of insuring them.”

You call that twisted logic, but isn't it accurate?

The alternative you suggest of letting the illegal immigrant sue his/her employer isn't something most employers would worry about. The chance of these typically poorer, less-educated people bringing lawsuits against their employers seems small, especially since doing so risks raising their profile to I.N.S.

I think the judge is correct: exempting employers from owing WC benefits to illegal immigrants would likely put legal U.S. citizens at a competitive disadvantage when looking for work. Why create such a negative incentive?

I'm perplexed why you think insurers are being disserved by the court's decision. If the employer reported the employee's payroll, what distinguishes the illegal immigrant's loss potential from a legal employee's loss potential?

I suppose there's a greater likelihood of language barriers complicating safety efforts, but that would be just as true of legal immigrants as of illegal immigrants.

Keeping workers safe and insurers solvent is plenty challenging enough without trying to harness the WC system to police immigration.

SAM RESPONDS:
My thinking is not firm on this. I appreciate feedback like yours to help me decide what is right here.

You make several excellent points, sir, but I would be interested if there is some way to quantify whether or not there are higher risks of loss among illegal alien workers than documented employees.

Also, would you feel the same way if the employer knew they were illegal, but hired them anyway, or conveniently accepted questionable documentation as proof of legal residence?

KEITH HAS THE FINAL WORD:
If studies emerge that prove illegal immigrants present higher loss potential than documented workers do, then I would support a pricing remedy.

Perhaps I.N.S. could notify NCCI of employers who have been caught employing illegals, and/or haven't complied with I.N.S. verification procedures for Social Security numbers. Such an employer's experience mod would be surcharged for three years so as to generate premium commensurate with the additional loss potential.

An approach like that might address the loss disparity without creating economic incentives for employers to favor hiring illegals over documented workers.

As for whether my feelings would change if I knew employers deliberately hired illegals or were deliberately lax in checking workers' documentation, the answer is no.

I believe such employers exist, and that they find illegal immigrants are less resistant to work rules and exert less wage pressure than legal employees.

What I want to avoid is presenting such employers yet another incentive to turn down legal workers in favor of illegal immigrants.

What we need instead are economic disincentives for employers to hire illegals. Dry up the jobs, and illegal immigration will largely end.

I'm appalled that this type of legislation would ever get passed. First they provide Medicaid benefits to illegal immigrants, and now want the insurance industry to fund the on-the-job accidents.

It appears more and more that the federal government searches for solutions to the symptom rather than solutions to the disease.

This is eerily similiar to the court cases where someone breaks into your house or business, get's hurt, and then expects damages for their injuries. At what point will the U.S. Government stop rewarding bad behavior?

We teach our kids this at age 3, but out government doesn't seem to get it.

The terminology has to be correct first. The subject being talked about is not illegal immigrants, but squatters. Would you call someone who snuck or broke into your home and wouldn't leave an illegal guest?

On that note, let's rephrase the question from "Should Illegal Aliens Get Workers' Comp?" to "Should you be forced to provide for an illegal guest in your home, at your expense?"

To answer both questions - NO!

This is what happens when lawmakers do not address fundamental issues, government attempts to address negative consequences through bureaucratic finese, creating a myriad of conflicting, short-sighted "solutions" such as this one.

Sam, you have covered the subject very well. We must resolve the issue of illegal immigration, and then LEGAL IMMIGRANTS and employers will fit within existing laws applicable to all of us.

From "Ground Zero" of illegal immigration, we have become a haven for illegal employment and the employers who take advantage of those who will work for substandard wages and under substandard conditions.

As long as nothing is done to stem the flow into the country, and the employers are not scrutinized for their hiring practices, why not use the insurance industry as the scapegoat when an injury occurs? Then you can have us as a backup to the rest of the social give-away and freebie systems that are in place.

Day laborers are all over the streets near the local home improvement centers and certain places near the freeways, where there may be contractors and homeowners looking for cheap labor.

Honestly, the industry is insuring tens of thousands of illegals every day without even knowing they do, because it's casual labor, although some work is on construction sites or on landscape or work crews alongside those who are here legally.

Yet we get not a penny in premium on the worker and when the loss occurs, it's actually a fraudulent claim, as everything immediately backpedals as the name is frequently changed, documents produced from another worker, etc. Sometimes the worker even changes names in midstream!

I deplore illegal immigration, and believe the U.S. government is turning a blind eye to the issue. Relations with Mexico are more important than true border security, or the border would be sealed.

It will not be until a major incident occurs, way above the current level of criminal activity--perhaps a major terrorist attack that was precipitated and moved through the border undetected--will anything be done to stem the flow of illegal traffic.

As for me, I'm scared with the rhetoric I hear from the Congress and Senate and their two leading cohorts in the upcoming elections, because I think the situation will be getting worse as the floodgates open wider.

I have a possible solution to this problem:

In New York State, employers who knowingly hire underage workers who then are injured on the job are required to match whatever workers' compensation benefits the workers are awarded with an equal amount from their own pockets.

If this law is expanded to cover illegal aliens knowingly hired by employers, then there would be a solid disincentive to hiring them, as employers would have to match compensation awards with their own funds.

Employers would be able to defend themselves from this double-indemnity provision by proving they made a good-faith effort to secure proper ID from their employees.

All workers should remain entitled to comp benefits if they get hurt on the job while working as someone's employee. Otherwise, the class of workers NOT entitled to benefits will become an even MORE attractive source of labor to employers than they already are, driving up demand for them even further and driving down demand for more expensive local citizens for the work.

The issue of "black market businesses" is a different issue, where agreements to perform a project or do work, and pay or get paid for it, are informal, where it's not clear that an individual is anyone's employee or an independent businessman or businesswoman or a partner in a partnership, where no records are kept, and so on.

The black market is driven by the ever-increasing costs piled on by governments to "do good" for employees, to the point where it is overwhelmingly expensive for a small business to have any employees at all any more. So no wonder "alternative arrangements" for getting work done are sought out.

It's these alternative arrangements, failure to keep payroll records, failure to buy WC insurance or to inform the WC carrier of the work being done and the payrolls being paid, that cost the WC carriers large "gaps" in premium collections--gaps that then have to be filled by more conventional and law-abiding businesses.

Let's not get cause and effect reversed here. It isn't the availability of illegal immigrants that causes black-market business operations. The cause is in the enormous cost of maintaining a work force in full accordance with labor laws and taxes and entitlements. Illegal immigration is a result, not a cause.

Whose getting the short end of the stick'? How? And, by whom?

If payroll is being concealed for the purpose of avoiding workers' compensation premium payments, that's insurance fraud--by an insured employer, not employees.

It's not any harder to collect workers' comp premiums associated with work performed by illegal immigrants than it is to collect premium associated with work performed by citizens or other legal residents.

If a policyholder is going to commit fraud, the underwriter's problem is not the immigration status of that policyholder's employees.

I know it just anecdotal, but I've never encountered a workers' comp underwriter who demanded to review its customer's employee immigration status documentation as a pre-condition of offering or continuing coverage or when performing a premium audit.

Nor have I ever encountered a single instance where a workers' comp underwriter told an insured employer, "Hey, don't pay me (or, take that premium back). I'm not entitled to it because your employee is an illegal immigrant."

So, what entitles us now, in our professional capacities, to rise up in righteous indignation when an underwriter is called upon to pay the claims they got paid to cover?

This is silly.

Those who want to deny WC benefits to illegals are taking advantage of a nationalistic legal environment to get out of their otherwise commonly accepted obligations.

Denying WC benefits to illegals goes against the spirit of the system. Workers' comp was not intended to reward people of a certain nationality; it's an employee benefit, period.

In any case, employers aren't really defrauded in an employment-at-will situation. Both sides know what's being offered and what's wanted.

Immigration laws are not the concern of employers unless there is tangible punishment for ignoring them. Indeed, few employers would refuse to hire illegals if they were legal.

It seems obvious where the problem lies: with the immigration laws themselves. But since we're stuck with these laws, the only parties that should be concerned with this issue are the relevant governments.

Why? There are two competing systems of regulation at work here--the regulation of movement and the regulation of indemnity.

I have to share a funny story about illegal workers.

As an investigator I drove a plain blue Ford four-door sedan, and when visiting a plant that was a distance from the city, pulled up in front and asked a man where I could find a supervisor or foreman, since the location of the office was not apparent.

The man's eyes were large as saucers and he mumbled something and ran away. As I walked toward the corner of the plant, about a hundred people were running away across a field and upon entering the plant it was almost deserted. Nobody knew where the foreman was and nobody spoke English.

Later that day I was taken to task by the plant owner, whom I found at another location, for running off all the illegal workers at the plant, and advised never to come to one of the plants dressed in anything but jeans and a tee shirt, or sweatshirt, and to leave that blue car somewhere else!

Point being he hired hundreds of illegals, knew it, and I found out even housed them in labor camps he built. Everyone closed their eyes to the issue because it was cheap labor and the insurance company was getting the short end of the stick, as Mikk points out above!

I think the South Carolina court got this one right. If illegal aliens are to be excluded, all that has to be done is to make the law clear.